Sunderland should be in a position to confirm Martin O’Neill as their new
manager on Saturday as he has agreed in principle to take the job.

Should a final round of negotiations go smoothly this morning, O’Neill will be in the director’s box alongside development director Niall Quinn to watch his new side take on Wolverhampton Wanderers at Molineux tomorrow.

He could even meet the players before they travel to the Midlands before putting the finishing touches to the fine print on his contract

Talks between O’Neill and Sunderland's American owner Ellis Short continued in London yesterday after an initial introductory meeting on Thursday evening went well.

O’Neill is keen to take the job and is willing to work within the budget constraints Short has given him, although the exact terms of his contract, including its length, are yet to be thrashed out.

O’Neill has also not finalised the composition of his backroom staff, and it is uncertain long term ally John Robertson is willing to relocate to the North East.

But none of these issues is thought to be a deal breaker and the club are confident the Northern Irishman will be confirmed as Steve Bruce’s successor before their trip to Wolves. The former Leicester City, Celtic and Aston Villa manager has asked for money to spend in the January transfer window, a request Short is understood to have granted even though he had not planned to invest any more of his own money in new players.

That could be as much as £15 million next month and O’Neill has also sought assurances he will have the means to be active in every transfer window if he feels he needs to strengthen the squad.

Short will not be handing out any blank cheques, but the billionaire is keen to back his new man if it is going to move Sunderland out of mid-table and into the clutch of clubs competing for Europe.

O’Neill’s impending appointment at the Stadium of Light has been received well on Wearside, with most supporters agreeing he is the outstanding candidate to take over.

Although there was support for Mark Hughes in both the boardroom and among a section of fans, it was feared he would be another Bruce-style appointment, looking to prove he can be a success at a club with big expectations, rather than O’Neill, who has already had successful stints with Aston Villa and Celtic on his CV.

The pursuit of O’Neill has also been well-received in the dressing room, although Quinn was forced to visit the training ground on Friday morning to address the players and explain the rationale behind the decision to remove Bruce from office.

Although Sunderland had won just twice this season and beaten only three opponents at the Stadium of Light in 2011, the players remained extremely loyal to him. Several, including Nicklas Bendtner, Wes Brown, Sebastian Larsson and John O’Shea, had only signed for the club in the summer and turned down rival offers because Bruce was manager.

The Daily Telegraph understands many key figures in the dressing room were shocked by the decision to sack Bruce, especially as he had been in good spirits on Wednesday and had inferred to colleagues he was going to be given at least another two games to turn things around.

Hours later Bruce had been sacked and the players felt Quinn needed to give his reasons for that call. Quinn, though, has urged the players not to lose faith or focus and confirmed to them O’Neill was the No 1 choice to replace him.

The meeting is understood to have ended amicably, with the entire first-team squad heading to a restaurant for a morale-boosting team meal, although it remains to be seen if there are any who wish to leave as a result of Bruce’s departure.

Despite the uncertainty surrounding his own future at the club, Bruce’s former assistant Eric Black has agreed to take charge of the team against Wolves in what may prove to be his final act as first-team coach.

“Our No 1 priority is to try to get a valuable away win and three points this weekend,” said Black, who had worked with Bruce at Birmingham City and Wigan Athletic before moving to Sunderland in May 2009.

“The lads have trained well,” he said. “Everyone is fully focused on what is sure to be a very difficult game.”